Question

At the end of January, Mineral Labs had an inventory of 945 units, which cost $11 per unit to produce. During February the company produced 1,750 units at a cost of $15 per unit.
a. If the firm sold 2,550 units in February, what was the cost of goods sold?
b. If the firm sold 2,550 units in February, what was the cost of goods sold?

Answer 1

Answer: $34,470

Explanation:

a. Cost of goods sold for $2,550 units

The inventory sold will include the 945 units which cost $11 to produce.

It will get the rest from the 1,750 units which cost $15 to produce.

The remaining units are:

= 2,550 - 945

= 1,605 units

Total cost of goods sold:

= (945 * 11) + (1,605 * 15)

= 10,395 + 24,075

= $34,470